Law Summary
Ethical Framework and Traditional Prohibition of Advertising
- All professional accountants must adhere to the Revised Code of Ethics for Professional Accountants in the Philippines.
- Traditionally, advertising beyond basic contact details and professional affiliations has been considered unethical.
- Reasons for prohibiting advertising include preventing undue competition, avoiding commercialization that undermines trust, preventing cost burdens on clients, and protecting small/new practitioners from financial disadvantages.
- The prohibition aims to maintain the dignity of the profession by avoiding self-promotion and commercial tactics.
Shift in Policy Regarding Advertising
- Due to expanded services and adoption of IFAC provisions, advertising is now permitted to the extent it provides necessary public information about practitioners and their services.
- Section 250 of the Revised Code of Ethics permits advertising but highlights potential threats to ethical compliance.
- Advertising must be honest, truthful, not exaggerated, and not disparaging of others.
- Accountants are encouraged to consult professional bodies if in doubt about advertising appropriateness.
General Conditions for Acceptable Advertising
- Advertising is allowed if it:
- Objectively notifies the public of factual information (e.g., name, services) without being false, misleading, or deceptive.
- Is in good taste and professionally dignified.
- Avoids frequent repetition or undue prominence.
- Prohibited advertising practices include:
- Self-laudatory statements.
- Discrediting or disparaging others.
- Using testimonials.
- Fee comparisons.
- Emphasizing competitive differences.
- Using vague or unverifiable claims.
- Billboard advertisements like tarpaulins and streamers.
Restrictions on Firm and Client References
- Firms cannot imply foreign international firms are practicing in the Philippines through affiliations.
- Client names or business details cannot be used in advertising without written client consent.
- Terms such as "Accredited" may not be used if accreditation is expired.
Internal Review Requirement
- All advertisements must be approved in writing by the Risk Management Partner and Managing Partner or equivalents before dissemination.
Permissible Publicity Examples
- Awards: Professional achievements and distinctions may be publicized but not used for personal gain.
- Employment Notices: Accountants seeking employment may advertise but must not publicize subcontract work in a way that solicits clients.
- Directories: Listings may include name, contacts, and services for contact purposes.
- Scholarly Participation: Authors or speakers may identify themselves professionally without promotional content.
- Training Seminars: Invitations for training are allowed with limitations to prevent overt marketing.
- Technical Publications: Issuance of technical booklets for clients or professionals is permitted.
- Staff Recruitment: Job vacancies may be advertised factually without promotional elements.
- Client Publicity: Accountants may publicize actions on behalf of clients primarily for staff but must focus on client objectives.
- Brochures and Directories: Factual and objective information on services and firm details may be issued.
- Stationery and Nameplates: Must comply with professional standards and avoid specialist claims.
- Practice Announcements: Establishment or changes in practice may be announced factually and discreetly.
- Reports in Client Documents: Caution required to ensure reports are not misleading; client permission advised.
- Anniversary Announcements: Media releases commemorating practice anniversaries are allowed every five years, emphasizing contributions and achievements factually.
- Websites: Professional websites may provide factual firm information and news, adhering to advertising rules.
Effective Date
- The rules take effect fifteen (15) days after publication in the Official Gazette or a newspaper of general circulation.